Authors: Fotios Pasiouras

Title: Consumer protection and financial intermediation

Abstract

This paper investigates the impact of financial consumer protection policies on bank net interest margins while controlling for a wide array of country-specific and bank-specific attributes. Using a dataset of over 2,500 commercial banks operating in around 100 countries over the period 2010-2014, I find robust evidence that disclosure requirements relating to financial consumer protection and the business conduct supervisory structure decrease bank net interest margins. The results also reveal that policies related to complaints resolution and the fair treatment of customers cannot be viewed in isolation of other country characteristics as the statistical significance of their impact depends upon the employed control variables.